Wunderlich Securities Believes Amazon DVD Dispute Will Likely Accelerate Digital Distribution Transition for The Walt Disney Company

In a report published Tuesday, Wunderlich Securities analyst Matthew Harrigan reiterated a Hold rating and $88.00 price target on

. In the report, Wunderlich Securities noted, “Walt Disney (DIS) and Amazon (AMZN-NR) are engaged in a new dispute largely centered on DVD and Blu-ray pricing, and, to a lesser extent, promotion and product placement. This likely presages continued jockeying between distributors and studios over pricing and profit allocation. Amazon may be reacting out of considerable pressure from investors to improve its profit profile with its current loss forecasts, but we think that Disney is apt to resist vigorously even if there is some moderate effect on immediate studio profits. Although Amazon has leverage on packaged media distribution, the increasing migration to digital distribution works in Disney's favor given a multitude of distribution conduits, including self-distribution.” The Walt Disney Company closed on Monday at $87.50.